How much buildings insurance do I need?
When assessing how much building insurance you require, be aware that you only need to insure the cost of rebuilding your home and not its market value.
If you live in a period house or unusual property, you should ensure that your cover is high enough to allow for rebuilding in the style of your home.
A common oversight occurs when homeowners extend their properties but forget to increase their buildings cover. In the event of a claim, a payout will only be made on the part of your house covered by insurance – a potentially costly error.
The rebuild cost of your home can be found on your home survey/buyer’s report or you can work it out by using the house insurance rebuilding calculator on the Association of British Insurers' website.
How much contents insurance do I need?
When buying contents insurance, don’t make the mistake of underestimating the worth of all your goodies such as CDs, DVDs, clothes, carpets, curtains, jewellery, electrical goods, bedding, books and kitchenware etc.
To work out how much contents insurance you need, make a list of the rooms in your house and under each heading write down all the items within them. And don’t forget to pop outside and list garden ornaments, bicycles and items stored in the shed if you want these included in your cover.
Alternatively, the Association of British Insurers (ABI) has a home contents value calculator to help you work out the value of your possessions.
Once you’ve made an inventory of your entire home’s contents, total their worth to work out how much contents insurance protection you require.
Note: you should ideally value your home once a year, and always after redecoration or buying new, expensive items.
Additional/Extended Cover/Accidental Damage
Always check what's included in the policy (see also small print). Some home contents insurance products cover certain items and circumstances at no extra charge whilst others only include them as additional extras. For example, ‘high-risk’ or ‘high value’ items may need to be listed separately and protected with additional/extended cover. These may include:
- Expensive audio-visual equipment
- Coin, stamp and medal collections etc.
- Pictures and works of art
- Expensive watches and clocks
Examples of types of additional/extended home cover include:
- Extended Accidental Damage – this protects you from such things as DIY disasters or accidentally staining your new sofa
- Family Legal Protection – offers you legal liability protection in certain circumstances such as being sued by someone who was injured in your property
- Guests’ Possessions Cover – covers your guests' possessions against loss, damage or theft while on your property
- Moving Home Contents Cover – protects your contents against loss, damage or theft during the period of moving home
- Freezer Cover – Confused.com research showed that the average freezer contained £173 worth of food, with 34% of freezers containing between £200 and £500 worth of perishables. Freezer Cover ensures you’re not left out in the cold should your freezer malfunction or if there’s a power cut
- Sports equipment or bicycle cover
- Garden equipment cover (can also include toys).
- Items in outbuildings/garage cover
- Alternative Accommodation – provides emergency temporary alternative housing
- Locks and keys – covers lost/stolen keys or damaged locks
- Emergency Assistance – cover for temporary repairs due to domestic emergency
- Cash/Credit Card – provides cover for theft
- Christmas uplift – amount of cover extends over the festive period
- Utility cover to and from property – covers underground service pipes/cables
- New for Old - claims paid on a new-for-old basis (except clothing and household linen)
- Contents Insurance can also be extended to cover items that leave the home with you, such as laptop computers, MP3 players, cameras, SatNavs, handheld games consoles, mobile phones etc. (sometimes called an ‘All-Risk’ policy). Alternatively, you can insure such items separately with a gadget cover policy.
You can also extend policies to cover children away from home in university accommodation, or to cover the Christmas season when there may be more valuables in your home.